More than 100 firms have delayed or cancelled issues, according to data compiled from China's two main clearinghouses for the interbank market and the interbank market operator. The state and private firms are from a broad range of sectors including cement, automobile and local government financing platforms, among others.
As of last Monday, data showed that only around 70 billion yuan of bonds had been cancelled in April so far, implying a substantial increase over the past week as bond yields have kept moving higher.
After China Shanshui Cement's default in November, which helped push low-rated bond yields higher, firms cancelled or postponed more than 40 billion yuan of bond issuance.
Chinese bond yields, however, have risen sharply this month, as rising worries about corporate creditworthiness and a less aggressive easing stance by the central bank drained liquidity from the fixed income market.
Speculative capital now appears to be flowing into commodities instruments instead, as investors bet on rising prices driven by the nascent recovery in Chinese construction. Chinese steel prices are up sharply in 2016, and trading volumes for Chinese commodity futures have spiked in recent days.
Benchmark treasury three- and five-year treasury yields are now up more than 25 basis points since the beginning of April. Corporate spreads have also risen following several high profile defaults, including that of Dongbei Special Steel Group Co Ltd, a state-owned steelmaker located in the northeastern city of Dalian.
Rising yields make bond issuance more expensive for firms. Cancellations also tend to rise along with stress in the fixed income market.